Corporate supporters of terror states under scrutiny.

• Author: Pappalardo, Joe
• Position: Brief Article

The flow of investment money to regimes that the U.S. government says support terrorism is coming under increasing scrutiny.

In August, U.S. Sen. Frank Lautenberg, D-N.J., sent letters to governors and state fund managers that decried the funneling of money to such regimes as "unconscionable." In the letter, he asked state pension fund managers to provide details of investments in companies with ties to stare sponsors of terrorism.

The top pension systems in the United States invested an estimated $118 billion in companies with legal sales or projects with nations such as Libya, Syria, Sudan and Saddam Hussein's Iraq, according to a Center for Security Policy study.

A grass roots organization headed by Frank Gaffney, the founder and president of CSP, is aiming its effort at creating legislation prohibiting state and local public money from being invested in companies that do business with terrorist-sponsoring governments.

The legislation would be similar to an amendment Lautenberg introduced to a corporate-tax bill this year that would have blocked subsidiaries of U.S. companies from operating in...